Almost half of homeowners (49%) are planning a home improvement project before Christmas, according to recent research. Each homeowner on average will spend £4,339 from their savings pot to pay for it.

Almost a quarter of people making home improvements are planning to draw on their savings (22%) with the remainder borrowing to fund the work.

A total in excess of £30bn is set to be spent on DIY projects in the next few months alone.

Most popular

Decorating is the most favoured DIY job, with 41% of homeowners planning to get the paint brushes out before December arrives.

A savvy 18% of respondents are taking advantage of gardeners being quiet and commissioning landscaping projects to get their garden in shape for 2020.

And for 12% of respondents, upgrading the kitchen is the top priority, even if it adds to the domestic chaos during the summer months.

Fund raising

Using a second charge loan is likely to offer better rates of interest as the loan is secured on your property. Unsecured loans from high street banks and other sources can be notoriously expensive, we have all seen the rates charged by the so called “pay day” lenders.

The reason for a secured loan being more cost effective is due to the lender having to assess the risk. If you are a high-risk borrower they will need to offset the risk with higher interest rates. So, if you offer security, then the risk involved is much lower and the lender will offer far better rates.

This is indeed particularly useful for those special groups such as the self-employed, retired or those who have had past credit problems.

Why choose a second charge loan?

• Faster to complete than a traditional re-mortgage.
• Normally less fees.
• Very attractive interest rates.
• Loans are very flexible.
• Ability to retain current mortgage deal if on a low rate.
• Helps the self-employed

Need some assistance?

If you think this type of loan could assist you in your future planning it is very important to ensure you get the right one to suit you. There are many different lenders offering numerous second charge loans so please do call one of our advisers.

Increases in the second charge loan market suggests economic uncertainty is causing more people to improve their current property rather than move.

Data shows there has been an 8.9% increase in people applying for second charge finance in the second half of 2018, when compared to the same time in 2017.

Figures also show that 51% of these second charges were applied for to make home improvements.

In addition, reports show a 9.2% increase in re-mortgage applications in January 2019 compared to the same period last year. This is reinforced by the ONS reporting in their December House Price Index that the rate of increase in UK house prices is 2.1%, the lowest UK annual rate since August 2013.

With an increase in re-mortgage applications, slump in the UK housing market and uncertainty around our economy, this could suggest more people are choosing to improve their current properties – rather than take a potential financial risk of moving.

It could be that Brexit worries are flattening the property market, meaning fewer people are moving and more homeowners are making improvements to their current properties rather than move during a time when it is still unclear how Brexit will affect property prices.

If you are looking to raise funds it’s important to consider a second charge as a solution for a refinancing or home improvement.

Like too know more?

Our independent advisers are fully trained and skilled in all areas of lending so please do contact us to discuss any requirements you may have.

The number of loan applications increased by nearly 23% in the month ending April 2019 compared to the same period last year. There has also been a significant increase in the value of applications for second charges in 2019 compared to 2018.

Our finance director commented, “I’m not surprised at these figures as second charge lending has a lot to offer the homeowner”. “If you compare a secured loan to an unsecured loan these figures are more than justified”. “Interest rates are at an all-time low and the diverse types of loans on offer will fit most needs

Increasingly borrowers are seeking alternative finance when a conventional re-mortgage is not suitable. This could be due to the current mortgage having early redemption penalties or the current loan being on an advantageous interest rate you don’t want to change.

When should you consider second charge lending?

Second charge loans nowadays come in “all shapes and sizes” and there is likely to be one to fit your needs. The crucial thing is to get independent professional advice as there are so many options open to homeowners.

Second charge loans can be used for many reasons, such as a deposit for a new property investment, buy-to-let and re-development of an existing property to name but a few.

Many borrowers now are also viewing second charge loans as a simple and a cost-effective alternative to mainstream lending.

Second charges are fast and can complete in a matter of days as opposed to months on a re-mortgage.

Can we assist?

When taking out a new loan you should seek independent professional advice, we have a team of experts waiting to take your inquiry so please do make contact.